Question

Sirignano Corporation produces and sells one product. The budgeted selling price per unit is $84. Budgeted unit sales for October, November, December, and January are 8,400, 12,000, 13,800, and 14,300 units, respectively. All sales are on credit with 40% collected in the month of the sale and 60% in the following month. The expected cash collections for November is closest to:

Answer 1

Answer:

Total collectible in November = $826,560

Explanation.

Sirignano Corporation

October

Sales $84 x 8,400 = 705,600

Collections in Oct 40% = $282,240

November

Sales $84 x 12,000 = 1,008,000

Collections in Nov 40% = $403,200

60% Oct collections in Nov = $423,360

Total collectible in Nov = $826,560

Collections in Dec 60% = $604,800